Last week explored two important aspects when attracting green businesses. This week, the last two amenities we see in most green company requests: Business Climate and Incentives. We also will go over some covenants that sites targeting green companies may want to consider for a business park.

Business climate is important to all businesses. Is your state, your county and your community invested in making businesses prosper? Most of the communities I work with cannot effectively influence the state and has a difficult time influencing the county. They themselves, however, can be agile, proactive, and quickly react when faced with issues. Proactively, we recommend education of councils on things like TIF, Urban Renewal, the pace of projects, and the need to be agile. Agility is key as issues always arise with projects and a community’s ability to quickly and efficiently address these issues, especially in rural communities, provide assurances to the companies looking to move there. Green companies want to see sustainability already embraced, like LEED buildings, City offices and other community facilities promoting energy reduction. Recycling programs, in fill incentives, and promotion of energy efficiency rehab tax reduction all let green companies know that their philosophy and culture will mesh well in the community. Less frequent but still important to some are the local wages, social services, and other worker support systems as it relates to responsible social impacts.

Next, the 900 pound gorilla, the elephant, the third rail if you will: cash. Specifically, incentives. For most industries a community, county, and state have set parameters and awards. High Quality jobs, retraining, local purchasing of goods all can reduce the amount of capital a company either has to initially invest or will be rebated in the future. Green companies are the same way. To attract a company focusing on responsibly building, responsible business practices, and social awareness, incentivize the things they already do or what you want them to do. Provide rebates for solar panels, more so if they allow residential or community buildings to connect to the lines. Look at the water usage and recycling plan. Would it beneficial to reduce the tax or fee in correlation to them reducing their impact on the system? We have seen companies fight to eliminate their property taxes for ten years to turn around and use a PILOT (Payment in lieu of taxes) for nearly the same amount. This stabilizes their cost and creates a fixed cost. The city then gets what they would have made in property taxes and distributes it as they see fit. This does impact the capture emergency services and school get from taxes, but responsible cities pledge a percentage, again, roughly the same amount they would have received from taxes, to the parties.

So, before we begin to target green companies, we need:

Infrastructure planned and green energy as part of that plan

Risk mitigated sites, especially environmental issues

A positive business climate and one with the green philosophy and culture at the heart

Incentives the increase with the “greenness” of the business and their continued efforts to become more green.

Next week, we will look at Woodward Iowa, the nation’s first Green Certified Building Site and what makes them special.

Good morning!

Over the past few posts and for the next few more, we have been looking at Green Business/Industry as an economic driver and target market. The last post, we differentiated between Green Company and Green Industry (the first concerning themselves with their business impact and the later assisting others with reducing impact.) In this post, we will discuss 2 proactive steps communities can take before and while they are targeting Green Companies to a new greenfield site. We will discuss the intricacies of Green in-fill later as it comes with its own set of landmines. New sites, prospective sites, or communities targeting Green businesses have an advantage as they do not have to retrofit.

First, Green is a niche market. Though the trend is for every business to embrace some green practices, a true Green Businesses represent a very small sector. This is not meant to be disheartening; instead, it is an opportunity. If there are businesses with a deep concern for environmental and social impact looking to expand, having a boutique zoning and uniquely designed with green initiatives will be more attractive than a site where the business must do all the sustainable work itself.

So, what do Green Businesses look for in new sites?

Our advice: treat Green Businesses as you would any other sector. Study the trends, find the key factors, and plan to address them. As we see it, every business entity, including green, look for infrastructure, site studies and any risk found in the studies mitigated, a welcoming business climate, and some sort of enticement/incentive when moving or building.

Infrastructure: No business will move to a location that cannot be served in a feasible (cost effective) way. This is true of green businesses as well. On-site renewable energy, renewable focused utility providers, progressive stormwater and wastewater covenants, and mass transit to and from the site are all recent examples of information requested by green companies.

Risk mitigated: Wetlands, endangered species, cultural history, soil, and any other required studies can be done prior to a site visit by an interested party. These are of particular concern of green companies, especially if there are any issues found. Mitigating these risks may cost the community upfront, but providing official documentation that the land is ready does two things: It advances timelines for construction at least 6 months (the minimum time it takes to complete these studies) and it makes the land more marketable, thus worth more, allowing the community to recoup the investment.

We realize this is a very macro view of Green Sites, but we have often found that communities make it more complicated than necessary. Next post, we will take on Business Climate and Incentives.

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